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CUNA opposes some HELOC changes

WASHINGTON (12/28/09)--The Credit Union National Association (CUNA) in a recent comment letter opposed some of the proposed amendments to Regulation Z that would make changes to the content and timing of disclosures related to home equity lines of credit (HELOCs). While CUNA said that it understands that the Federal Reserve Board has amended HELOC in response to abusive loan practices, “credit unions have not engaged in these practices, primarily because their mission and incentives are to serve their members, not to achieve and maximize profits.” While the Fed has proposed requiring that borrowers be given an early HELOC disclosure three days after the application is submitted and an account-opening disclosure at the time that the account is opened, CUNA has suggested that the Fed not require the account-opening disclosure “if the terms and conditions have not changed since the borrower was given the early HELOC disclosure.” However, the Fed’s proposal to increase the notification period for a change-in-terms from 15 to 45 days is a positive step that CUNA said would “benefit consumers” and would not impose significant burdens on credit unions. The mandatory compliance deadline should also be extended to at least 18 months after the proposed changes are made final, CUNA added. For the full comment letter, use the resource link.